Just whose list are we using? Your list, their list, my list, his list? ??? ....

Lawmaker Questions SEC "Terrorist" Investor List
By Kevin Drawbaugh and John Poirier
Reuters, Friday 13 July 2007

Washington - A senior Democratic lawmaker urged the Securities and Exchange Commission on Friday to either create a more accurate Web site identifying corporations with investments in "terrorist-financing states" or pull the plug on it.

Rep. Barney Frank, chairman of the House Financial Services Committee, expressed concern about how the list was compiled and asked the SEC to consider using a new methodology.

"Disclosure is important, but in this instance it is my belief the disclosure needs to be absolutely accurate or not occur at all," Frank said in a letter to SEC Chairman Christopher Cox.

Some business and humanitarian groups say the SEC's new online tool is ill-conceived.

The Web site allows investors to search for companies whose annual reports contain some reference to business related to Sudan, Syria, North Korea, Iran and Cuba. The countries have been designated as "state sponsors of terrorism" by the U.S. State Department.

The Institute of International Bankers says the SEC's search tool unfairly portrays a number of internationally-headquartered financial firms in a misleading, negative light and was compiled without regard to the materiality of their dealings.

In his letter, Frank said at least one company on the list had divested its holdings in the countries.

"Others apparently have investments that are so negligible they could not reasonably be considered material either to investors or the economy of the terrorist-financing state."

Frank said he recognized the SEC's "good intentions," but "the concept of a list generated in this fashion strikes me as unfair and perhaps counterproductive."

An SEC spokesman declined to comment.

In May, Frank's committee approved legislation aimed at discouraging investment in Iran by directing the Treasury Department to publicly disclose companies active in Iran's energy sector.

The bill, called the Iran Sanctions Enabling Act, would require Treasury to identify a company with business amounting to $20 million or more. The biannual list would require a description of the investment, and include an appeals process for companies to seek to remove their names from the list.

A similar bill has been introduced in the U.S. Senate, backed by Illinois Democrat and U.S. presidential candidate, Sen. Barack Obama.

The SEC's Web tool to search for companies with business in Syria, Sudan, North Korea, Iran and Cuba is at http://www.sec.gov/edgar/edgartlistfilings.htm.

(Thanks to June Hughes for this article)